VA's Decreasing Guarantees
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Hey Hank, I was hoping to find some professional discord on this VA link as the whole Wachovia/Wells Fargo/when are they going to give me another retention circle jerk got old.
You have solidified my thinking that this site is of little redeeming value. Good job!Good luck with that pent up hostility, Hank. I see that you are trying to start up a new circle jerk so I'll tap out at this point. Good night!
[quote=Gordon Gekko]I agree with your statement about risk going forward. One wholesaler tells me there is little chance anyone would use the living benefit if investing now. I am thinking “why would I have a client pay 3-4% versus 1 1/2 in a c share?”.[/quote]
Which c shares only cost 1.5%? Do you have the guts to name the ones that you use?
[quote=Gordon Gekko]
So do you use that daily lock VA?
That 1% can add up over time. 1% on a million x 10 years= 100k extra. For the right person, it makes sense. [/quote] Regarding that 1% over time: Do you really think somebody with a million dollars today, at the end of 10 years, is going be like, "I have an extra 100k!!! I win, I win!!! That chump with $1.9MM is really a loser!!!"? Given the fact that the market just shat 40%, I'd pay that extra 1% any day of the week.Yes, I would still use them if they paid me the same as mutual funds. You may not love broccoli, but you always get it with your steak and mashed potatos because you know it is good for you.Do you think VA’s would be as wildly popular if they paid the broker the same as mutual funds? Right or wrong, I doubt it due to the complexity/lockup/cost.
Invariably the people who compare MF and VA costs are almost always ignoring the fact that their comparing apples to oranges…VA’s are RISK MANAGEMENT TOOLS!!!..if risks are not a major concern for the client (and I’ve yet to find one for whom it isn’t) then by all means ignore the annuity conversation…but keep in mind, you do so at YOUR own risk!!!
It seems assets and sales in VAs are down, and some providers are slowing production to preserve capital if not decreasing withdrawal benefits and increasing charges. I wonder how advisors feel about these changes and whether the health (capital) of providers has come under question (even from clients).